Foreign spending rose 10.98 per cent in lead up to Canada's 150th birthday
TORONTO, July 20, 2017 /CNW/ - Spending in Canada increased by 3.88 per cent in dollar volume during the second quarter of 2017 over the same period last year, according to Moneris Solutions Corporation ("Moneris"), one of Canada's largest processors of debit and credit payments. This continues a trend of moderate growth demonstrated in the first quarter of 2017, which saw an increase of 3.46 per cent year over year.
Regionally, all provinces posted growth, with the exception of Newfoundland and Saskatchewan, which were down 0.22 per cent and 1.71 per cent respectively. Quebec posted the strongest growth of the quarter, with spending up 5.75 per cent year over year. Nova Scotia, Ontario and British Columbia also saw strong increases of 5.10 per cent, 4.45 per cent and 5.04 per cent respectively. Following seven consecutive quarters of decline, spending in Alberta increased 0.31 per cent year over year, marking a return to growth for the province.
"The uptick in spending across most provinces, along with the Bank of Canada's announcement to increase interest rates for the first time in seven years, is evidence of a growing confidence in the economy," said Angela Brown, President and CEO of Moneris. "We expect to see a continuation of moderate growth for the balance of the year as the economy shows signs of stabilizing and the Canadian dollar rises to stronger levels."
Growth increased steadily over the quarter, with April posting the smallest increase of 1.44 per cent year over year. May posted 4.39 per cent growth over the same month last year, with growth peaking in June at 5.94 per cent year over year.
Along with slight increases in GDP1, average weekly earnings2 and retail sales3, posted by Statistics Canada for the month of April, credit card spending continues to rise with a 4.75 per cent increase over the same period last year. Debit card spending is similarly up 2.31 per cent year over year.
Foreign spending growth driven by U.S., China and Mexico in Canada's 150th year
In the lead up to Canada's 150th birthday and an expected increase in tourist visits to the country, international card spending grew 10.98 per cent this quarter over the year before, with the majority of spending coming from U.S. cards. The 7.23 per cent increase in spending on U.S. cards aligns with findings from Statistics Canada, which reports that April 2017 saw more U.S. travellers making overnight trips to Canada by plane than any other April since modern recordkeeping began in 19724.
Spending from China increased 24.62 per cent year over year, making the country the second highest contributor to foreign spending growth by volume. Mexico came in third, with a 66.31 per cent increase in spending on cards from the country. Australia moved out of the top three this quarter, becoming the fourth highest contributor to foreign spending growth by volume, with an increase of 17.78 per cent year over year.
Share of contactless payments rises as the payment option matures
The second quarter of 2017 marked the launch of Android Pay in Canada and the one-year anniversary of the full introduction of Apple Pay in the Canadian marketplace. Canadians are continuing to take advantage of the growing number of contactless payment options available to them, driving a year-over-year increase of 36.29 per cent in total contactless dollar volume this quarter. This rate of growth is not as strong as it was a year ago, when total contactless dollar volume grew by 162.52 per cent year over year, indicating that the contactless payment option may be reaching a point of maturity.
The share of transactions made using contactless payments continues to rise at a consistent pace. In the second quarter of 2017, nearly 40 per cent (39.50 per cent) of all transactions made were with tap-and-pay methods, up from 30.86 per cent in the second quarter of 2016. Moneris predicts close to 50 per cent of all transactions will be made using contactless payments by the end of 2017.
"With the introduction of more tap-and-pay options for consumers, and adoption numbers that show a slower, but sustained increase in use, it's clear contactless payments have become a preferred method of payment for Canadians," said Brown. "Businesses that have embraced this payment option are benefitting from the ability to serve a large group of consumers who enjoy the convenience and ease of contactless payments."
Note to editors
Please see MonerisMetrics infographic for highlights, including top categories and spending by province.
As one of North America's largest providers of payment processing solutions, Moneris offers credit, debit, wireless and online payment services for merchants in virtually every industry segment and processes more than three billion transactions, annually. Moneris offers electronic loyalty and stored-value gift card programs. With more than 350,000 merchant locations, Moneris provides the hardware, software and systems needed to improve business efficiency and manage payments. For more information please visit www.moneris.com.
SOURCE Moneris Solutions
For further information: Media contact: Emily Ngai, FleishmanHillard, 416-645-8179, [email protected]